Spotify Is Ready to Move Music Way Past the Jukebox Model

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Spotify Is Ready to Move Music Way Past the Jukebox Model

Spotify

Spotify announced today that it's acquiring two companies: Soundwave and Cord Project. Both are small-ish startups, founded in the last couple of years, that have won accolades for their design chops. Soundwave in particular makes perfect sense for Spotify. It's a social tool for finding, sharing, and talking about music, which are all things Spotify would like to be as well. Cord Project is a more curious fit: it's an audio-first messaging app, a sort of walkie-talkie for the smartphone age. It had apps for Android, iOS, and the Apple Watch, all with a tap-and-talk voice messaging system at their core. What does Spotify want with a messaging app?

It's not enough to have 30 million tracks in your library anymore.

What Cord really did—what founders Thomas Gayno and Jeff Baxter do best—is design audio experiences. Over the last 18 months or so, as they've built Cord, they've also launched Chhirp, which was basically a big microphone button you'd use to upload 12-second audio clips to Twitter. And there was Shhout (these names!), where you'd just flip your phone upside down to activate the microphone and send a message to everyone who follows you. "We found ways to create really compelling experiences around the production of audio," Gayno says.

They'd also been thinking about the other side of the equation: how we listen to audio. Turns out Spotify was interested in the same thing, with music in particular. "For years," Gayno says, "we've been listening to music on phones and on laptops kind of the way we listen to music on our hifi stereo, by just looking for a song and hitting play." We find and listen to music like we're at the world's biggest jukebox. Spotify has recently started experimenting with variations on that form, with features like Running and Party and the brand-new Behind the Lyrics feature it created with the folks at Genius. They're trying to do more than just find you music you'll like—they want to change the way you experience it altogether. That's a hard problem to solve.

Not Just Music

The two companies began talking late in 2015, sort of by accident. Cord was in the middle of trying to raise a Series A round of funding, and it wasn't going well. They'd been approached by "a large technology company" (they won't say which one) about an acquisition, and then all at once their investors wanted to introduce them to Spotify. The first time they talked—while Gayno was in the maternity ward with his new baby—they clicked. "They'd been kind of these ad-hoc things," Baxter says of Running, Party, and the other experiments Spotify had been running. "And they'd been thinking of starting a group around that. And here we were!"

Cord's many projects will start to wind down over the coming weeks, as the team transitions to new teams and offices. (Luckily Spotify's New York City office happened to be right around the corner.) They're going to do that quickly, because they have a lot of work to do. Through The Echo Nest's incredibly detailed tech and its years of usage data, Spotify has a ridiculous trove of data about much more than just music. The Cord crew is the start of a new team at Spotify dedicated to turning that data into entirely new kinds of auditory experiences, "leveraging all the amazing technology that is available on my MacBook Pro, on my iPhone, all these things," Gayno says. "The accelerometer, the geo-localization, all the social network data I have provided, is available for Spotify to create a compelling music experience."

Music is only the beginning, too. "Music is obviously the biggest chunk" of the audio industry, Gayno says, "and where things should start." But the long-term plan for Spotify involves podcasts, news, even video. "The place to innovate is on the consumption side," Baxter says. "So we're still working on that. It's still, what are unique ways that you can serve up audio to people, on phones, but also on devices of the future?" It's not enough to have 30 million tracks in your library anymore. The streaming wars will be won by the company with the best experience, the best discovery, the best tools for listening to the right thing at the right time in the right way. Spotify's data and curation skills go a long way toward creating perfect playlists, but to soundtrack your life it needs a design that's as adaptable and versatile as the music itself. Two guys with weird ideas about messaging apps and microphones might be perfect.